UPDATE 4-Estonia arrests 10 in Danske Bank money laundering inquiry

* Those detained are under suspicion of money laundering (Adds detail, quote from Estonian police, prosecutor)

TALLINN, Dec 19 (Reuters) - Estonia has arrested 10 former employees of the local branch of Danske Bank as part of an international investigation into alleged money laundering.

Authorities in Denmark, Estonia, Britain and the United States are investigating payments totalling 200 billion euros ($229 billion) made through the tiny Estonian branch of Denmark's largest bank between 2007 and 2015.

The arrests announced by Estonia's state prosecutor on Wednesday mark the first concrete action by authorities against suspects in the unravelling money laundering scandal.

The threat of a heavy fine from the U.S. Department of Justice has sent Danske Bank's shares plunging almost 50 percent since March, erasing around $15 billion off its market value.

More arrests are likely, Estonia's head of criminal police Aivar Alavere told a news conference in Tallinn, adding: "The acts, which lasted for years, were systematic, coordinated and targeted, always targeted on making money".

The 10 Estonian citizens detained on Tuesday and Wednesday are alleged to have been part of a network that facilitated flows of dirty money through Danske Bank's branch in Estonia.

"The suspects are the so-called first line of defence, client managers whose job was to make sure money laundering does not happen," prosecutor-general Lavly Perling said.

The 10 people have not been charged, but under Estonian law can be held for 48 hours without formal charges.

In a report published in September, Danske Bank said it had reported 42 former employees and agents "deemed to have been involved in some suspicious activity" to the Estonian Financial Intelligence Unit.

Estonian state prosecutor Marek Vahing said the country's authorities were cooperating with Danish and U.S. counterparts.

Danish authorities have so far outlined 25 billion euros of suspicious flows in the case, Alavere said. A spokesman for the Danish state prosecutor declined to comment on this.

Danske Bank, which had also reported eight former employees to the Estonian police, could not confirm on Wednesday if the 10 detained people were among the employees already reported.

A spokesman for the bank said he had no further information about the arrests. ($1 = 0.8775 euros) (Reporting by Tarmo Virki; additional reporting by Jacob Gronholt-Pedersen and Stine Jacobsen; editing by Jason Neely, Jane Merriman and Alexander Smith)